What to know: 2024 Social Security and Medicare rates announced
The Social Security Administration last week announced that monthly benefits will increase by 3.2% next year, far less than this year’s 8.7% increase, which was the largest cost-of-living adjustment (COLA) in 40 years. An average beneficiary will see their monthly payment rise next year by $59 to $1,907, up from $1,848.
The Centers for Medicare & Medicaid Services (CMS) also announced important 2024 changes to Medicare premiums, deductibles and high-income premium surcharges. The standard monthly premium for Part B, which covers things like doctors, outpatient care, emergency services, some preventive care and durable medical equipment, will rise 6% to $174.70 in 2024, from $164.90 this year – an increase of $9.80.
Social Security typically deducts Part B premiums from benefit payments, so the net effect of the COLA and Part B changes will be a monthly benefit increase of $49 for the average Social Security recipient.
The COLA is determined by the annual increase in consumer prices for the 12-month period ending in September. Rates of inflation have fallen sharply this year, with the Federal Reserve Board repeatedly raising interest rates to help cool off the economy.
CMS also released 2024 details for Part A of Medicare, which covers inpatient care in hospitals and skilled nursing facilities, hospice, inpatient rehabilitation and some in-home care. The deductible for Part A will rise 2% to $1,632 in 2024 from $1,600 this year. Two-percent increases will also be applied to coinsurance programs for hospital and skilled nursing care.
Part A is funded by Social Security payroll taxes. People who pay payroll taxes for at least 40 quarters during their working lives do not pay premiums for Part A. For the small percentage of those who do not qualify, Part A premiums will decline by $1 to $505 a month for those with fewer than 30 quarters of covered earnings; they will remain at $278 a month for people with between 30 and 40 quarters of covered earnings.
The CMS announcement also covered next year’s high-income Medicare surcharges, which apply additional premiums for Part B and Part D drug plans for about 8% of the highest-earning Medicare enrollees. Those rates also will increase about 6% from 2023 levels, from $70 to $74.20 for those making more than $103,000 and less than $397,000.
Author bio
Philip Moeller is the principal author of the Get What’s Yours series of books about Social Security, Medicare, and health care. Read his Substack newsletter and his posts on Threads @healthauthor.
